British landlords need to know the costs of BTL

Across the UK, the number of people who are looking to get a slice of the buy-to-let pie and bring themselves an additional income as a result is increasing each and every month as companies continue to report improving rental prices.

In fact, the country now sees some 1.5 million owners in the private rented sector, with the swell in buyers now meaning that mortgages in the sector account for a full 13 per cent of all lending.

However, the assumption that this means a good rental return should not be made too hastily, according to one company, which stated that there are still pitfalls. A study conducted by YouGov discovered that many people do not know the costs of buying to let, an issue which can drastically reduce their income.

It found that while the vast majority are aware of the cost of a mortgage - something that 93 per cent of people will budget correctly for - there are other things they will need to shell out on which can leave them short in the long run if they do not factor them in.

For example, only 68 per cent were aware of the price of agents fees, whereby they pay a lettings agent to advertise their home, arrange viewings and contracts and generally deal with all of the legal ins and outs of what is still a tricky sector at the moment.

More worryingly, most people fail to factor in any other costs at all, with other fees being considered by just 46 per cent of new landlords.

These can include such essentials as landlord insurance or unoccupied homes cover. Meanwhile, those who are purchasing homes, for example, that are situated in a block of flats, will sometimes need to pay upkeep and janitorial fees as well as a maintenance charge.

YouGov's results warned that anyone failing to take all of this into account could actually see their long-term ambitions for returns suffer greatly.